Legal cannabis markets are spreading in the United States. Back in 2018, it only had a total legal spending of $9.8 billion. According to the Arcview Market Research and BDS Analytics, this number is projected to grow to a total of $30 billion by 2024. What is the cause of this exponential growth? Check out this infographic put out by BDS Analytics for mg.
There are two main events in 2018 that have led to this growth. The first event was the FDA approval of GW Pharmaceuticals’ Epidiolex. Epidiolex is a cannabidiol prescription medicine that has been proven to treat two kinds of seizures – Lennox Gastaut syndrome and Dravet syndrome – both in adults and children. This prescription drug was approved by the FDA on June 25, 2018 and has then had a continuous increase in sales in the U.S. markets.
The second event is the passage of the Farm Bill where hemp was legalized. The 2018 Farm Bill added provisions on the cultivation and marketing of hemp. If you can recall, U.S. Senator Mitch McConnell has become the face of this hemp provision with even a hashtag #HempFarmBill coined. Of course, with the passage of this bill comes a lot of changes for the marijuana agriculture sector. In fact, hemp has also been granted insurance programs similar to crops that have been legalized in the bill. Part of this bill is the legal transfer of hemp and hemp-derived products across state lines. Both of these events have added fuel to the fire when it comes to the ‘Total Cannabinoids Market' or TCM.
In terms of U.S. expansion, legalized cannabis markets will not only have an increase in manufacturing and sales. They will also have increased medical programs spreading awareness and usage of products and medicines with CBD. By 2024, every U.S. state, Washington D.C., and four other U.S. territories will already have continuous medical programs. On the other hand, there will be active adult-use markets for CBD in 20 states, Washington D.C. and two other U.S. territories.
In the financial side of things, cannabis is also becoming a hot market for investment. Prior to 2018, only a fourth of $14 billion was invested in the industry. Today, cannabis companies have raised investment capitals in order to increase production, improve distribution, and drive more sales.
Arcview Market Research and BDS Analytics have provided a list of the top 10 states that would have the highest legal CBD spending for 2024. California comes out on top with a forecasted $7,231 million followed by Colorado and Florida with $2,049 million and $1,898 million respectively. Other states included in the list are New York, Michigan, Arizona, Nevada, Washington, and Massachusetts. Coming in 10th in this list is Illinois with a forecasted legal spend of $1,141 million.
Overall, the legal cannabis markets are seeing great days ahead of them. Thanks to the two events in 2018, the CBD market has become a growing industry where more and more people benefit from it medically. Although there is still much to work on, the approval of the FDA and the 2018 Farm Bill have become the starting point of this growth.